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NuPathe Inc. Message Board

  • crazyworld4u crazyworld4u Nov 19, 2013 10:09 AM Flag

    Time for "Use Your Brains People - Part 4"

    This whole PATH situation really is very very humorous to me.
    Here we have a company that has devoted many years already and a lot of money (hundreds of millions) and has successfully achieved FDA approval for a much needed and very efficacious product.
    Now they are within a few months of launching that product in the USA.
    We then get their LAWYERS advising them to put a "bankruptcy warning" in their latest quarterly report - just to cover their butts of course. That's what good lawyers do, right?
    Meanwhile, I would bet that the lawyers' friends and family are quietly accumulating shares newly made super cheap by aforementioned boiler-plate warnings.
    And we are to believe, or at least be scared like deer frozen by headlights, that PATH's big 4 or 5 investors that have millions of dollars on the line, will let PATH file bankruptcy and have their valuable patents auctioned off in court for peanuts, instead of throwing PATH a "few more" measly bucks to ensure a launch that could return mega bucks to them instead of coal.
    It's rather humorous, do you not agree?

    Sentiment: Strong Buy

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    • Crazy,

      The "bankruptcy warning" is not to warn the general public, rather it is to warn those "true" owners represented by the board directors.

      PATH has an FDA approved product with promising potential, but the PPS has been sinking from nearly $4 to today's $1.8 and the company still does not have a partner, something is "wrong". And I suspect the "true" owners do not agree with each other.

      The IPO was priced at $10 and with $140 millions paid in. The secondary a year ago was priced at $2 with warrants and that brought in $28 millions. Anyone wants to take over would need to pay 200 -300 million ( I firmly believe that PATH worth 1 billion but with today's situation, huge discount has to be given).

      Suppose someone offered 300 million, that will translate into $7.5 pps on fully diluted base or $10 when remaining warrants are canceled (they are out of the money anyway). Some owners with voting power will not have the warrants, while others do. They have to compromise something or "die" together. Remember, the average cost is $6, some is higher, others are lower.

      AA said "significant progress", I believe it meant all the parties have reached some agreement by principle. if no action is taken shortly and certain cash level not maintained, chapter 11 is a real possibility. Remember, some of the 10+ million cash are "restricted" and the firm needs to keep certain level of cash according to the terms of term loan.

      Do not think chapter 11 will happen, but that will require some wisdom from the few big holders.

      Sentiment: Hold

      • 1 Reply to mkmnymklv
      • So if they go BK everybody losses and 300 million goes down the drain. Why would anyone allow that to happen? Maybe someone thinks they can pick up on the cheap after BK and restore this and make a killing. Should be some criminality with that scenario. Don't like to even respond to this. The mere mention is a PPS killer. It seems to me that the only way everyone wins is via a partnership which brings the product to market and ultimately a $12 plus PPS.

    • Yes, this doesn't look good for SFE.
      Credibility is on the line.

      Sentiment: Buy

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